Entrepreneur's Corner

Government Should Shield The Banking Sector From More Taxation – John Gachora

BY Juma · October 16, 2024 03:10 pm

KEY POINTS

"When it comes to taxation in the sector, for every Sh100, Sh57 goes to the government in tax, Sh28 goes to employees and Sh18 goes to shareholders. We would like to implore the government to shield the banking sector from more taxation," he said.

The Managing Director of the NCBA Bank, Mr. John Gachora, has called on the government and stakeholders to shield the banking sector from more taxation that has often affected how the sector serves the small and medium enterprises within the country.

Speaking during the Inua Biashara Forum organized by the Kenya Bankers Association (KBA), Mr. Gachora said there was a need for banking to be supported given the crucial role that it plays in supporting the Kenyan economy through SMEs.

“When it comes to taxation in the sector, for every Sh100, Sh57 goes to the government in tax, Sh28 goes to employees and Sh18 goes to shareholders. We would like to implore the government to shield the banking sector from more taxation,” he said.

Gachora said that the power of MSMEs to the Kenyan economy should not be underscored and that more support was needed to cushion thousands of MSMEs that might close shop in the face of inadequate support. He called on all stakeholders to join hands.

“As an industry, we acknowledge that MSMEs play a crucial role in our economy, contributing about a third to Kenya’s GDP and providing 8 to 9 of every 10 job opportunities in the country. Supporting their growth, therefore, is vital not only for economic development but also for poverty reduction through innovative business solutions,” he added.

At the moment, the SME sector in Kenya employs about 86 percent of the Kenyan population and contributes about 45 percent to the country’s GDP. However, according to the Kenya National Bureau of Statistics, about 450,000 MSMEs shut down in Kenya annually with the major cause being inadequate access to affordable credit.

The event saw the launch of the Inua Biashara MSME Exhibition as well as the release of the Banking Industry Total Tax Contribution Report at the KICC. The event offered a platform to empower MSMEs whilst enhancing their access to tailored financial solutions.

“By strengthening engagement between MSMEs and the banking sector, we stand as a catalyst to their growth, innovation, and long-term sustainability,” said Mr. Gachora.

About Juma

Juma is an enthusiastic journalist who believes that journalism has power to change the world either negatively or positively depending on how one uses it.(020) 528 0222 or Email: info@sokodirectory.com